Selling A Phone In Australia Is Bloody Expensive

Ever wondered why some phones make it to Australia and others don’t? As it turns out, it’s because the cost of certification and licensing costs way more than you’d think, even for non-flagship phones.

You can get a phone in Australia generally one of three ways: either you buy from an approved reseller/retailer, directly through a carrier like Telstra or Vodafone, or by importing.

The latter is a nice option when a phone isn’t officially available in Australia. And there’s plenty of phones that aren’t officially sold here. You can’t get Samsung Galaxy phones with the Qualcomm chipset locally — only ones with the Exynos chip. The affordable OneNote phones generally don’t come to Australia, either.

An imported phone, mind you, means the phone hasn’t been tested and certified for use on Australian networks. That doesn’t mean it won’t work, but that the company hasn’t paid for the device to go through the rigorous certification process.

And according to Sam Skontos, Alcatel vice president and regional managing director of Southeast Asia and the Pacific, when the cost of certification is combined with the cost of testing with Australian carriers, the figure runs into the hundreds of thousands of dollars.

“That’s my concern about bringing a product from overseas because it’s cheaper, yet it’s not Australian compliant,” Skontos said. “I can tell you now – for me to test a product in the Australian market, based on the labs we have to go through for electrical safety testing, for RF and all that stuff, it can cost me up to $20,000 to $25,000 to test. When you’re talking about a $99 phone, that’s a significant cost.”

Another attendee at the luncheon mentioned that other manufacturers had been saying the cost of becoming carrier-compliant was much higher in Australia. Skontos agreed, saying that the Alcatel head office bore additional costs just to make their headset compliant with carriers beyond the electrical certifications.

“It could cost, without any extra R&D costs to make it … to do all of that, there are specific certification that you need, the figure is probably closer to $200,000 to $220,000 — it could go to $250,000, but I don’t think it would go too much beyond $250,000. It’s significant.”

The figure matches up with chatter Kotaku Australia heard at Computex this year, following the reveal of ASUS’s ROG gaming phone. ASUS representatives couldn’t confirm or deny the cost of certification or carrier compliance in Australia, but the chatter amongst journalists (from discussions with other manufacturers) was that the total cost of bringing a phone to Australia was around $250,000 to $300,000.

Skontos went on to stress that he wasn’t criticising the carriers for the high cost of compliance, because at the end of the day they were doing the right thing by their customers. “What happens when a product fails? The first thing a consumer does is blame the network, and the carrier can’t afford to have products that aren’t tested on their network, that aren’t working properly on their network, that aren’t efficient on their network to be out there,” he said.

And he’s not wrong: the telecommunications ombudsman charges carriers for every complaint referred. While the TIO no longer publicly lists the fees for each referral, the fees were listed on their website two years ago:

A snapshot of the TIO’s volume fees from April 2016.

So if you’re ever wondering why some phones are never sold in Australia, this is why. On the bright side, at least there’s importing — if you don’t mind taking the risk, anyway.